Screening Profitable Small-Cap Stocks with Volatility and a KDJ Crossover

Summary

This Chinese A-share screening proposal combines daily price movement, a newly formed KDJ crossover, market capitalization below 10 billion yuan, and positive earnings over recent years. It describes the crossover as a technical signal and profitability as a basic fundamental filter, while larger intraday range is used to seek more active candidates. The note includes formula and Python examples intended to implement the conditions and form a watchlist.

The author flags several limitations: high price variability can increase risk, KDJ signals can be false, small companies may have weak liquidity or other difficulties, and using historical earnings can introduce timing bias. Suggested refinements include more technical indicators, broader financial analysis, and relaxing the size constraint. The article does not provide a backtest, specify execution rules, or report returns. Its examples also contain apparent inconsistencies between stated units and code thresholds, and the crossover and earnings calculations would need validation before use.

Key ideas

• The proposed screen combines price range, a fresh KDJ crossover, a market-cap ceiling, and recent profitability.
• The note treats volatility as a way to find active stocks while warning that it also raises risk.
• It identifies false technical signals, weak liquidity, and historical-data timing as potential problems.
• It recommends combining technical indicators with more thorough financial analysis.
• No performance evidence is presented, and implementation details should be checked against the stated criteria.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.